But how should you construct your glossary or definitions page from a SEO and usability standpoint?

Ammon Johns recommends breaking down your page into sections of 15 or so words on a page, and ordering them by alphabet. For example, break them out like A-G , H-R , S-Z. Not only that, but hyperlink them from your pages to the definition.

Let me show you how I have been doing it on my corporate site for years now.

On my company page and throughout my site, I have dotted underline words that symbolize there is a definition for that word. When you place your mouse over that link, it changes the curser to a question-mark. Then it uses the title attribute to overlay a snippet of that definition for that word. Here is a screen capture:

In this case the word is "World Wide Web" and if you click on it, it will link you to the definition page and anchor you down to that word.

My definitions page is one long list, but there is no doubt that I should probably break it up one day and add more to it.